Small and Medium Enterprises to Take the Reins in Programmatic TV

Programmatic TV is not only the purview of big agencies and national advertisers. Small and medium enterprises (SMEs) will actually be the vanguard. Yes, it’s true that big data and targeting audiences at scale are essential to the programmatic television advertising value proposition. But it’s smaller-scale advertisers—the nation’s small and medium enterprises—that are likely to adopt these advanced media-buying platforms first.

Mind the Competition

Programmatic is important to local television stations, which are being shaped by cord-cutting and over-the-top viewing. Local broadcasters are gaining prominence in so-called skinny bundles, looking for broader distribution of content, and creating cross-promotions with HD antenna manufacturers. All this constitutes an attempt to counteract the threat of digital, according to Marketing Land, and these efforts—along with programmatic’s better targeting and measurement capabilities—have the potential to reverse the downward trend of television spending.

Marketing Land also thinks broadcasters will target their push to programmatic at SMEs first. After all, as the World Bank reminds us, they account for some 90 percent of businesses and 50 percent of employment worldwide.

You’re Pre-Qualified!

But sheer volume is not the only reason SMEs and programmatic TV are a great match. First, small and medium enterprises are already onboard with automated platforms. These SMEs are thriving thanks to self-service advertising platforms such as Facebook, Google AdWords, and Google AdSense.

Second, they’re already dipping their toes into audience data. Today’s self-service data platforms provide the same relatively easy access to pre-segmented audience data, according to ExchangeWire, allowing SMEs to make programmatic ad buys without an agency.

Finally, they may have the most to gain. A 2014 study by Deloitte for the UK’s Advertising Association found that each additional £1 spent on advertising by an SME in Great Britain has eight times the effect on sales relative to its size compared to the impact of an extra £1 spend by a large business.

It’s About More Than Tech

Smaller advertisers may enthusiastically help prove the concept of programmatic television ads to large advertisers. According to Broadcasting & Cable, to make programmatic TV work for small and medium enterprises, local station groups will need to leverage what has traditionally made them strong: relationships.

During a panel discussion at Broadcasting & Cable’s recent Programmatic Summit, industry experts noted that while more data and improved audience measurement are important to all advertisers—no matter their size—local advertisers take a very direct approach to measuring ad effectiveness: Did more people come into their store?

Small and medium enterprises will still require more hands-on help from ad sales teams. The takeaway for local stations is that programmatic TV should be additive—no one should forget the tried-and-true methods that still deliver on the promise of broadcast advertising.